tv On the Money NBC November 25, 2013 12:30am-1:01am PST
welcome to "on the money." i'm maria bartiromo. my conversation with jack bogle. the founder of vangaurd. what he says about the market bubble. minimum wage, maximum debate. we're raising salaries and more people into the middle class or will it stop the creation of much needed jobs. i'll talk to one of the first tv stars to turn entrepreneur. suzanne somers with life after threes company. "on the money" begins right now. >> this is america's number one financial news program. "on the money." now maria bartiromo. here is a look at what's making news. it was a historic week on wall street.
for the first time ever the dow jones closed above the 16,000 mark. theç average climbed more than 100 points on thursday to reach that record. the markets continue to rise and set yet another record on friday. the minutes from the october meeting said a slowdown in the bond buying program could come in in the next few months. retail sales rose for the month of october increasing more than that .4 of a percent. a mixed bag of earnings from retailers this week. home depot meet expectations as did best buy. lowe's and target missed expectations. americans seem to love their teslas. annual survey of car owners found the model s took the top
spot. owners of the all the electric sedan priced at $90,000 gave it the highest consumer report sought in years. the market hit some big numbers. the fed rattles investors with taper talk. what does it mean for your money? joining me now is jack bogle. thanks so much for joiningç us. >> nice to be with you. >> the dow setting a fresh record high this week, topping 16,000 for the first time. s&p and the nasdaq flirting with their own milestones. are these numbers a big deal? do equities feel frothy to you at this point or no? >> i don't think badly so. if you go back a decade the dif send on the standard and poors index is up about 100%. the s&p index is up. that's 60. using that is one of many, many guides. there don't seem to be signs of
excessive valuation. 2% dividend yield is not a generous yield but it's been in that area for a decade now. the more things have changed in the price of the market the more they have remained the same in the value of the market with dividends going up even faster than the stock prices. >> earlier in the weeks the markets were nervous with the federal reserve statement that it plans or there's a possibility that they could slow down the bond buying program in the coming months if the economic data supports it. no big surprise. we all know the tapering will come at some point. how much attention shouldç a lg term investor pay to the news like that? >> i'd say ignore it. the news of the pending change and then another week or so from that it will be another change for another reason. all it's going to get you to do
is take action and i think investor should never forget get worried about what happens when tapering is slowing down and get out of their stock position or a lot of their stock position. they also have to figure out when to get into their stock position. to try to be right twice in the market, in my experience, is impossible. >> speak of the fed, janet yellen approved by the senate banki ining committee as the ne chairman of the fed. she's likely to continue the policies of ben bernanke. do you think they're working in. >> i think they're working as well as they can. i think we talked a bit about it before. the problem we have here is any economist will tell you working your way through these difficult times requires both fiscal policy and that is the united states income and expense, the u.s. treasury revenues and taxes and expenditures.
the fed has carried 100% of the burden and logic would tell you and economics would tell you the fed can't carry 100% forever. i think it's a lot to ask. i don't see much relief on the fiscal policy side. congress is more stalemated than ever now that we have the filibuster will be more difficult and that will get everybody down there madder and madder. it seems to be a very badly run political system that we have in the u.s. right now. to me, that's the biggest risk to the market. >> should investors stick to their knitting and make sure they're keeping the allocation with stocks and bonds that way they want with the markets rise or is there another action to be taken going into year end? >> i'm a basicallily stay the course kind of person. i don't think big rebalancing is
a good idea and i don't think small, because it involves more certainty. you go to a 40% stock position. i don't see anything that would justify that. the small re-balancing with 100 points or 1,000 points in the market isn't going to make much }even in you get it right once because you're not going to get it right twice. >> you've been an advocate of having your age as the percentage to have in bonds and the remaining in equities. you should count social security as part of those bonds. is that still the case? >> that's still the case. it's not a simple adjustment. when a person dies their social security vanishes and their bond portfolio is still intact. i call it a good rule of thumb. you're depending more on
investment capital rather than human capital which carry you through most of your life. your earnings and your career. as you get investment capital to be more important i think you want something more reliable. >> i know that we have to really be looking at a person's age and their risk tolerance but knowing what we know now about the stock market would you put new money to work in stocks today? >> yes. i would put it in, if you have new money and running a 70/30 stock bond position i'd put it in 70/30. i wouldn't use new money. i wouldn't avoid investing in new money. it involves a confidence about i don't es a confidence about have, and i don't think most people should have. maintain your balance. if you're putting new money to work just keep that balance. >> great to have you on the program. thanks so much. >> thank you. >> we'll see you soon. jack bogle joining us.
up next, walmart's low, low prices are not affordable for everybody. employees at one of company's stores hosted a food drive to especially sure other employees would have a thanksgiving dinner. is it time to start rethinking the minimum wage? we'll find out. later, suzanne somers went from funny girl to the boss. she sold 10 million thigh masters and runs a leading business. who's laughing now? back in a moment. ♪
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the subject of raising the minimum wage is a controversial one. does it raise living standards or does it eliminate jobs? a photo surfaced showing walmart employees in canton, ohio holding a thanksgiving food drive for fellow employees. should it be raised from $7.25 joining me now is jared bernstein and former bureau of labor statistics keith hall.
thanks for being here. >> sure. >> happy to be here. >> walmart claims it was intended for a few associates experiencing hardships. do you think people are using this for their cause or does this prove the company is not paying employees enough? >> it's probably both of those are true. these things tend to be used nor cause. recently mcdonald's released a suggested family budget for their employees and it became a big story many the same way because it assumed the ridiculous amount of work at very low wages. when you have one group of low wage workers fprovidingç food other low wage workers it strikes people for a good reason. the president, to his credit, has suggested an increase in minimum wage would help. >> five states have enacted minimum wage hike and there's a
bill to raise the federal level from $10.10. does raising it lead to fewer jobs or higher unemployment? >> there are dozens of studies on the effects of minimum wage. this has been done for decades now. if you focus on those minimum wage studies that look at effective minimum wage on the lowest scale workers, i think you see a pretty consistent result that raising minimum wage raises the unemployment rate for the lowest skilled workers. if you look at the number of people who would be effected by an increase by the type the president is proposing. over 80% of them are above 20 years of age. they are mostly adults. i accept keith's characterization to a point that job loss or unemployment effects and some of the studies are negative but they are small negative. some are positive. they tend to clump around zero.
even for less skilledç workers the benefits outweigh the cost. >> there was a recent study that found the families of fast food workers are enrolled in one or more public assistance programs at twice the rate of all workers. this costs taxpayers nearly $7 billion a year when the fast food industry generated $200 billion in sales annually. are we shifting the responsibility of taking care of these low income workers from the companies on to the taxpayers? >> that's unfortunate to see but one of the things is that we have such a weak labor market. it's not just the simple jobs that are effected. it's the employment at all levels. currently, the minimum wage earners are only about 1.6 million minimum wage workers. two-thirds are single, never married. one in four is full-time. that means three-quarters are not full-time workers. minimum wage jobs like that are
not for the normal breadwinner. they are salespeoppeople helpin families in distress or young workers. >> let me speak to that. i disagree with that framing in the following sense. keith is correct when talking about people now earning the minimum wage but the relevant group are the people who areç effected by a minimum wage that went up to $10.10. these are the working families that you teed up in the introduction of the story. >> the effect of minimum wage and workers is not rocket science. it's common sense. if you raise the cost of hiring low skilled workers competition will drive them to find s substitu substituted. >> what about small business and entrepreneurs starting out?
wouldn't it hurt their profitability? >> i think that's a very important point. i think that it does cut into some profits because his logic is correct. that's textbook logic. profitability is one of them. profitability, there's some price shifting, there's some productivity enhancement and hours decline as well. it's all of the above. you shouldn't overemphasize one angle of it. >> thanks so much. important discussion to have fp appreciate your time. >> thank you. >> up 7ext, my conversation wih actress suzanne somers. the three's company star was fired from her most famous role and reinvented
welcome back. my next guest turned playing a dumb blonde into a stainable lifetime career on her own turns. suzanne somers joins me now. also author of "i'm too young for this." >> i'm happy to be here. i admire you. >> and i you. what a lifetime of success. i want all your tips. over the course of your career you've licensed hundreds of products putting acting aside for a moment.
you're a great businesswoman. tell me about the diversity of your business interest. >> you have to be interest to the message you're putting out. it started with the thigh master which i said to my husband that's going to ruin my career. he said at the moment you don't have a career so there's nothing to ruin. >> it skyrocketed. >> it did. the comedian told me. david letterman would do thigh master jokes. we sold over ten million at last count. we got into this whole entrepreneursh entrepreneurship. when i was doing three's company i got branding and nobody was doing thatç back then. i said chrissy snow has a distinct look and we should sell ponyta
ponytails and head bands. they said this is about the show. now i get to do it on my own terms. she was a bankable, brandable character that never really had an opportunity to be so. i now brand suzanne somers. suzanne somers has a point of view, and that is we're living on a polluted planet and my niche is organic toxic free. i have toxic free makeup. toxic free skin care. toxic free household cleaners and beauty products. >> tell me about your jobs. >> i got fired on three's company for asking to be paid commence rate with the men. i had the number one show and the highest demographics. >> you were the star. let's face it. >> there were two important characters. after i got over the depression of being fired at the height of my success, i decided i would
neverç work for anybody ever again. that's what i've done. i wrote books by day and started having the string of best sellers. then i gained weight and i wrote a series of books. we sold about ten million summer size books. it was atkins and south beach but i was kind of their first. i understood that science. then i lost all my hormones. that was a surprise. i found out how to replace hormones naturally. this what this book is about. women 35 to 50 are losing their hormones ten years earlier because of toxins and stress. >> there's some controversy about this. how should average consumers sort through this debate going on? >> you have to understand the
agenda of the controversy. i don't understand hormones. if i sold the hormones you probably wouldn't like me being the one saying use natural. there's never been an incident of cancer from the hormones. the cancer society did a study of 422,000 women and they found the women who took my kind ofç hormones, the biogeneral cal hormones from age 40 on had a 41% decrease risk of breast cancer and the study of 80,000 women showed women on the synthetic hormones had a 69% increase risk of breast cancer. to me the dangerous, the controversy is over synthetic and what i'm taking is putting back what your body once made. they are by prescription because you don't want to fool around by hormones. it's done by a blood test.
there's a website by foreverhealth.com. it's a specialty that not all doctors understand. >> you were a pioneer in acting. also a pioneer in this entrepreneurship. what did you like better. i guess when you started your own business you're running your own show. >> that's the big thing. i like working for myself. i don't have a boss. i am the boss. i am the boss. >> it feels nice to say that. >> as well as i do and as hard as i want to work. anything that goes out with my name as a consistency. my women talk to me throughç twitter and on air. they say i know if you put it out, it's good. if you have a company you have to make sure you never sell out. >> it's your name. >> it's my name. >> it's your reputation. thanks for joining us. suzanne somers. >> thank you. up next, a look at the news this upcoming week that will
here is a look at the stories coming up. on tuesday we'll get housing start for the month of september and october. the home price index also out for the month of september. on wednesday we'll see how consumers feel about the economy. on thursday the country will celebrate thanksgiving and enjoy a little turkey dinner. the markets are closed for the holiday. on friday the markets are hope for half a day of trading closing at 1:00 p.m. time. also it's black friday. the kickoff to the holiday kicking season. finally, it's time for me to say thank you. this will be my last broadcast ofç "on the money" and my last weekend at cnbc. you've been amazing viewers. i want to thank you for watching and spending your weekend with me for these years. it's been a honor and privilege to be with cnbc for the last 20 years. i'd like to thank all of my
colleagues, the producers, editors, camera men and so many others who put the show together every week and make it look so easy. special thanks to joel crammer and put the show together weekend after weekend. it's hard to say good-bye but i know change is good. i have nothing but warm and happy feelings about the network that i will depart. know that i appreciate everything and everyone watching. "on the money" will be back next week. i wish you a happy thanksgiving everybody. to those who've waited... worried... poked and prodded... taken risks... and lived in a state of "what if?"... welcome to a new state... of health. welcome to covered california. the place to find quality, affordable coverage. financial help for those in need. and nobody can be denied because of a pre-existing condition. enroll now at coveredca.com.
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[ girl ] make dinner pop! >> the anniversary of the assassination of president john f. kennedy. welcome back to hollywood,ern. this is the weekend edition. i'm shaun robinson. i'm standing at daley plaza in dallas, just steps away from the precise spot that president kennedy was shot. throughout the show, we will be commemorating the an anniversary and we have some fascinating stories to tell you. right now, we're going to go to hollywood with kit hoover. hi, kit. >> shaun, it was the worst kept secret in hollywood. it was finally made official last weeng. adam levine is named the sexiest man alive. and this is all i need to see that adam is the perfect choice. >> how